WA farmers say criteria for concessional loans has been unfair as millions unspent

Criteria for WA's loans are considered to be much more strict than other states.

Audience submitted

A WA farming group has accused the State Government of "financial discrimination" in its handling of Commonwealth concessional loans.

Millions in unspent funds from WA's share of the scheme are set to return to the Federal Government after about 40 farmers applied for the $25 million package.

Compared to other states, criteria for WA's loans are considered to be much more strict.

The funds cannot be spent on buying fertiliser or reducing debt, areas which many farmers argue that money could be most of use.

Muntadgin Farming Alliance spokesman Jeff Hooper says if the loan criteria were fairer, the money could have helped many more in regional WA.

"It's very disappointing that the money has been lost, but I can see why, because people are just loath to take it up," he said.

Mr Hooper says regional WA is losing the money because of the State Government's failure to fairly deliver the scheme.

"It's been made available to other states under the criteria that not just us but others have been asking it to be made under, so it's actually financial discrimination," he said.

WA Farmers president Dale Park says the State Government's eligibility criteria for the package has prevented many who needed the funds from applying.

"I think there's been a bit of philosophical encroachment too," he said.

"We know the Government and Minister have said time and time again, 'we're not lenders of last resort.' What we keep explaining to the State Government is you actually aren't the loaners of the funds."

A spokeswoman for WA's Agriculture Minister says once a final figure on the leftover funds is calculated the Government will discuss with the Commonwealth where the unspent money will go.

The Federal Agriculture Minister's office says any unused funds will be returned to Commonwealth consolidated revenue.

Despite the low take-up, WA's Department of Agriculture has assured farmers that the level of funding for the second round of the concessional loans will remain untouched at $25 million.

The first round of the loans closed at the end of last month and the second round is set to open for applications on July 1.

In a statement, the Federal Agriculture Minister says he has approved a move to increase the maximum loan from $200,000 to $400,000.